Uncommon Wisdom

Nov 17 2009   2:06PM GMT

Droid, Android, and how Google could hurt Apple

Tom Nolle Tom Nolle Profile: Tom Nolle

Verizon, Motorola and Google can all be pleased at the pace of Droid sales, estimated at $250,000 the first weekend. While Apple’s iPhone sales record dwarfs that of Droid, it’s still the fastest-selling Android phone, and it’s said to be already responsible for half the Internet activity for Android handsets. Another report says it will likely drive Android past Windows Mobile in market share soon, a formidable achievement despite Microsoft’s indifferent promotion of its mobile phone system in the past.

Droid seems a clear winner, which could have significant impact on the credibility of Google’s Android and the potential Android may have as the near-term, de facto competitor to the iPhone and the eventual winner in the smartphone space. Apple with iPhone now faces a very “Mac-like” dilemma. The IBM PC won decisively in the market because it was open, but Apple has stayed very profitable and continues intact, while the PC has been fragmented and sold off to various players.

Should Apple now open things up with iPhone to seize market share or play the same game in the smartphone space? We think they’ll decide for the latter, but Google is a much smarter competitor than any Apple has faced before, and an Android success could establish Google as a broader alternative OS player, something that would hurt not only the iPhone but the Mac.

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